An Overview of Freehold Restrictive Covenants
What is a Covenant?
This is a promise made by deed by a Covenantor (the person giving the promise) to do or not to do certain things stated in the deed for the benefit of the Covenantee (the person receiving the promise).
What is a Restrictive Covenant?
Where a covenant is “Restrictive” and involves a “Freehold”, the Covenantor promises not to do something stated in the specific deed to the land/property for the benefit of the Covenantee.
The subject matter that is restricted can vary from caravans being parked on the property, using the property for the purposes of a business or even the placement of a new satellite dish.
The enforcement of such covenants is a method for restricting or controlling the use of the land to avoid undesirable effects on other people and their property.
However, a Covenant needs to satisfy certain conditions in order to be able to be enforced or restrict another.
When can they be enforced?
Rules were laid down for a burden of a covenant to pass in the case of Tulk v Moxhay [1848] 41 ER 1143), as follows:
- If the Covenant is negative in nature, positive covenants will not be enforced.
- The Covenant must benefit the land, not the Owner.
- The burden of the Covenant must have been intended to run with the land of the Covenantor (s79 Law of Property Act 1925).
- The purchaser is to have notice of the Covenant’s existence at the Land Registry by a notice on the charges register (s29 Land Registration Act 2002).
- The party who wishes to enforce the Covenant must own or have a qualifying interest in the land itself.
What is a Positive Covenant?
A Positive Covenant, in a Property context, is one that places a responsibility on a party for something to be done or money to be spent, say for example to build and maintain a fence or to repair a shared roof.
What if a Covenant has been Breached?
The terms of the Covenant need to be considered to identify whether a breach has occurred, and if so, this can give rise to an award of damages and/or an injunction (where the breach is causing or is likely to cause continuing damage).
It is more common for the courts to now award damages instead of an injunction; in some cases based upon the price, the Covenantor might be expected to negotiate in order to have the Covenant released, rather than by enforcing an injunction.
Can a Covenant be Discharged or Modified?
It is possible under Section 84 Law of Property Act 1925, but not easy, to apply to the Upper Tribunal for a discharge or modification of a Covenant.
Compensation can be awarded to those affected by any modification or discharge that is made. But in order to do so you must show that the Covenant is:
- Obsolete; or
- An obstruction which is stopping reasonable use of the land; and
- All parties affected by the covenant have agreed that the covenant should be discharged or modified, or that the discharge or modification would not injure anyone entitled to the benefit of the restriction.
Contact Gregory Abrams Davidson
If you are impacted by a Freehold Covenant or believe you may be, contact our Property Law experts who can advise on Property matters such as Freehold Covenants and Property disputes.
We can talk through your options and discuss your next steps and how we can assist.
Please feel free to contact us to discuss with no obligation 0151 236 5000, email us at info@gadlegal.co.uk or fill out our online enquiry form.
